ABSTRACT
This chapter discusses the relation between income security and retirement, with special reference to the influence of deduction rules which depend on the recipient's income and reduce benefits payable for disablement, sickness, retirement, and the like. If funds for social purposes are limited, it seems unfair to give equal benefits to all, irrespective of income. Deduction rules based on the ends they seek to achieve may therefore be employed. Unconditional benefits are, therefore, socially uneconomic because the needs of those with little or no income are not fully met while individuals with high incomes may be given benefits they do not really need. Total income would be lower than it would have been had earnings remained below the need-limit. The difficulty of objectively ascertaining decline in economic capacity decreases when full employment and an excessive demand for labor are assumed; unemployment beyond that caused by season or relocation does not count as need.
